Mercari (4385) AI Stock Analysis

• Market Cap: $372.12B
• Dividend Yield: N/A
• Average Volume (3M): 3.05M
• Price to Earnings (P/E): 14.2
• Beta (1Y): 0.55
• Revenue Growth: 2.79%
• EPS Growth: 92.79%
• Country: JP
• Employees: 2,080
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Specialty Retail
• EPS (TTM): 30.30
• Shares Outstanding: 164,692,180
• 10 Day Avg. Volume: 3,724,380
• 30 Day Avg. Volume: 3,051,140
• PEG Ratio: 17.42
• Price to Book (P/B): 4.78
• Price to Sales (P/S): 1.83
• P/FCF Ratio: -7.89
• Enterprise Value/Market Cap: 1.35
• Enterprise Value/Revenue: 2.61
• Enterprise Value/Gross Profit: 3.64
• Enterprise Value/Ebitda: 16.03
• 1Y Price Target: $2,722.23
• Price Target Upside: 22.05% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 70 Outperform
• Price Target: ¥2,531.00 ▲(13.47% Upside)

Mercari's overall stock score reflects strong profitability and technological advancements, particularly in the Fintech segment, as highlighted in the earnings call. However, financial performance is hampered by high leverage and negative cash flows, and technical indicators suggest a cautious outlook due to mixed signals. The valuation is reasonable, supporting a balanced view of the stock's potential.

Mercari Business Overview & Revenue Model

Company Description

Mercari, Inc. (4385) is a Japanese e-commerce company that operates a popular online marketplace where individuals can buy and sell new and used items directly with each other. Founded in 2013, Mercari has established itself as a leading platform in the consumer-to-consumer (C2C) sector, providing a simple and user-friendly mobile app that facilitates transactions across various categories including fashion, electronics, home goods, and more. The company aims to create a seamless trading experience by offering features such as secure payment processing and shipping options.

How the Company Makes Money

Mercari generates revenue primarily through transaction fees charged on sales made through its platform. When a seller lists an item and successfully sells it, Mercari takes a percentage of the sale price as a fee, which typically ranges from 10% to 20%. Additionally, the company earns revenue from optional services such as promoted listings that help sellers increase the visibility of their products. Mercari also benefits from partnerships with shipping companies that facilitate faster delivery options, enhancing the user experience and encouraging more transactions. The combination of these revenue streams allows Mercari to sustain its operations and invest in further growth and development of its marketplace.

Mercari Financial Statement Overview

Summary

Mercari shows strong revenue growth and improved profitability margins, but faces challenges with high leverage and negative cash flows. The company needs to address its cash flow issues and manage debt levels to ensure long-term financial stability.

Income Statement

Mercari has demonstrated consistent revenue growth over the years, with a notable increase in revenue from 2024 to 2025. The gross profit margin remains strong, indicating efficient cost management. However, the net profit margin has shown volatility, reflecting fluctuations in profitability. The EBIT and EBITDA margins have improved, suggesting better operational efficiency.

Balance Sheet

The company's debt-to-equity ratio is relatively high, indicating significant leverage, which could pose financial risks. However, the return on equity has improved, showcasing better utilization of shareholder funds. The equity ratio is stable, reflecting a balanced asset structure.

Cash Flow

Mercari's cash flow situation is concerning, with negative operating and free cash flows in recent years. The free cash flow growth rate has been negative, indicating challenges in generating cash. The operating cash flow to net income ratio is also negative, highlighting potential liquidity issues.

Breakdown	TTM	Dec 2024	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	192.63B	187.41B	192.63B	171.97B	147.05B	106.11B
Gross Profit	138.26B	129.73B	138.26B	114.42B	95.14B	81.80B
EBITDA	31.40B	20.42B	31.62B	19.63B	-3.04B	13.06B
Net Income	26.11B	13.46B	26.11B	13.11B	-7.57B	5.72B
Balance Sheet
Total Assets	543.76B	501.77B	543.76B	415.29B	339.86B	262.53B
Cash, Cash Equivalents and Short-Term Investments	147.03B	197.31B	147.03B	204.73B	218.85B	171.46B
Total Debt	199.38B	193.31B	199.38B	160.55B	131.35B	71.15B
Total Liabilities	444.12B	429.63B	444.12B	360.06B	301.87B	222.52B
Stockholders Equity	99.27B	71.84B	99.27B	55.35B	37.68B	39.63B
Cash Flow
Free Cash Flow	-12.25B	-43.49B	-12.25B	-36.40B	-26.89B	2.95B
Operating Cash Flow	-11.95B	-43.34B	-11.95B	-35.82B	-26.22B	3.37B
Investing Cash Flow	-31.36B	-877.00M	-31.36B	-601.00M	-671.00M	6.91B
Financing Cash Flow	504.00M	32.09B	504.00M	25.17B	62.06B	19.77B

Mercari Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2230.50
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4385, the sentiment is Negative. The current price of 2230.5 is below the 20-day moving average (MA) of 2285.13, below the 50-day MA of 2307.70, and below the 200-day MA of 2323.84, indicating a bearish trend. The MACD of -3.85 indicates Positive momentum. The RSI at 44.27 is Neutral, neither overbought nor oversold. The STOCH value of 18.98 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:4385.

Mercari Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4385	70 Outperform	$372.12B	14.22	31.21%	―	2.79%	92.79%
3064	69 Neutral	$1.04T	33.77	28.71%	1.15%	14.16%	26.13%
3964	69 Neutral	¥98.03B	16.37	―	2.43%	29.05%	33.61%
7685	69 Neutral	¥99.79B	23.83	―	0.92%	53.22%	93.84%
3092	67 Neutral	$1.13T	24.96	47.74%	2.77%	6.80%	0.62%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
4755	55 Neutral	$2.17T	―	-25.86%	―	11.07%	23.91%

Mercari Corporate Events

Mercari’s Earnings Call: Profitability Soars Amid Growth Challenges

In the recent earnings call, Mercari showcased a robust operational performance, marked by significant achievements in profitability across its segments and the successful integration of AI technologies. Despite these accomplishments, the company faces challenges in achieving top-line revenue growth and meeting its GMV growth targets, highlighting areas that require strategic improvement.

Mercari Reports Strong Profit Growth Amid Modest Revenue Increase

Mercari, Inc. is a Tokyo Stock Exchange-listed company known for its popular marketplace app, operating primarily in the e-commerce and fintech sectors. The company is recognized for its innovative approach to consumer-to-consumer transactions and its expansion into financial services.

Mercari Reports Strong Financial Growth for Fiscal Year 2025

Mercari, Inc. reported its consolidated financial results for the fiscal year ended June 30, 2025, showing a notable increase in profits and revenue compared to the previous year. The company achieved a 2.8% increase in revenue and a significant rise in operating profit by 59.2%, reflecting strong operational performance. Despite a decrease in cash flow from operating activities, the company improved its equity position, indicating a solid financial footing. The financial outlook for the next fiscal year anticipates continued growth in revenue and operating profit, suggesting a positive trajectory for Mercari’s market positioning.

The most recent analyst rating on (JP:4385) stock is a Buy with a Yen3200.00 price target. To see the full list of analyst forecasts on Mercari stock, see the JP:4385 Stock Forecast page.

Mercari Reports Significant Fiscal Year Profit Increase

Mercari, Inc. announced a notable difference between its projected and actual business results for the fiscal year ending June 30, 2025. The company recorded a significant corporate income tax benefit due to changes in its US subsidiary’s capital policy, resulting in increased profits across its Marketplace, Fintech, and US operations. This reflects Mercari’s strategic focus on top-line growth, which has led to substantial increases in revenue and profits compared to the previous fiscal year.

The most recent analyst rating on (JP:4385) stock is a Buy with a Yen3200.00 price target. To see the full list of analyst forecasts on Mercari stock, see the JP:4385 Stock Forecast page.